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Difficulty: MediumTransportation Modes and Network Connectivity

A mining corporation operating in a landlocked region needs to transport large volumes of heavy, low-value iron ore to a distant inland processing plant across terrain where navigable waterways are absent. Based on transport cost principles (terminal versus line-haul costs), which mode of transport is economically most suitable for this long-distance overland freight movement?

  1. Rail transportAnswer
  2. B
    Road transport
  3. C
    Air transport
  4. D
    Pipeline transport

Answer

Rail transport is economically most suitable because of its low line-haul costs per unit over long distances for heavy bulk freight.
Rail transport is designed for long-distance haulage of heavy, bulky, non-perishable goods. Although building tracks and terminals requires high initial capital, its line-haul cost per tonne-kilometer drops significantly over long distances, adhering to the tapering rate principle.

Step-by-Step Solution

1
Analyze cargo characteristics and distance constraints
The cargo is heavy, low-value bulk solid material (iron ore) moving over long overland distances without water routes.
Transport selection depends on matching cargo bulk/value ratio with distance and modal cost curves.
2
Evaluate transport cost structure (Terminal vs. Line-haul costs)
Road has low terminal but high line-haul costs. Rail has high terminal but low line-haul costs for long overland distances.
Over long distances, low line-haul costs outweigh high fixed terminal setup costs.
3
Select the optimal transport mode
Rail transport offers the lowest cost per tonne-kilometer for heavy bulk solids across long inland distances.
Rail provides high carrying capacity and energy efficiency over long distance land corridors.

Key Concept

Tapering cost principle and modal suitability for freight transport
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Topics

Transportation Modes and Network Connectivity

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